An overview of each of our ETFs and delivering true active management with the benefits of a traditional ETF structure
This material is authorized for use by existing shareholders. A current Davis Fundamental ETF Trust prospectus must accompany or precede this material if it is distributed to prospective shareholders. You should carefully consider the Fund’s investment objective, risks, fees, and expenses before investing. Read the prospectus carefully before you invest or send money.
Davis Advisors paid AssetTV their customary licensing fee to reprint this profile. AssetTV is not affiliated with Davis Advisors, and Davis Advisors did not commission AssetTV to create or publish this profile.
Objective and Risks. Davis Select U.S. Equity ETF’s investment objective is long-term capital growth and capital preservation. The Fund invests primarily in equity securities issued by large companies with market capitalizations of at least $10 billion. Davis Select Worldwide ETF’s investment objective is long-term growth of capital. Davis Select Financial ETF’s investment objective is long-term growth of capital. Under normal circumstances the Fund invests at least 80% of its net assets, plus any borrowing for investment purposes, in securities issued by companies principally engaged in the financial services sector. There can be no assurance that the Funds will achieve their objectives. An investment in Davis ETFs is subject to numerous risks, including possible loss of principal. The Fund is actively managed and does not seek to replicate a specified index. The Fund is subject to the following principal risks: authorized participant concentration risk, common stock risk, depositary receipts risk, exchange-traded fund risk, fees and expenses risk, financial services risk, focused portfolio risk, foreign country risk, foreign currency risk, headline risk, intraday indicative value risk, large-capitalization companies risk, manager risk, market trading risk, mid- and small-capitalization companies risk, and stock market risk. See the prospectus for a complete description of the principal risks.
The expense ratio for each fund is: Davis Select U.S. Equity ETF: 0.60%; Davis Select Financial ETF: 0.65%; and Davis Select Worldwide ETF: 0.65%. Davis Selected Advisers, L.P. has contractually agreed to waive fees and/or reimburse the Funds’ expenses to the extent necessary to cap total annual fund operating expenses as shown until March 1, 2018. After that date, there is no assurance that the Adviser will continue to cap expenses. Prior to the cap the gross expense ratios were: DUSA: 0.66%; DFNL: 0.66%; and DWLD: 0.68%. The expense cap cannot be terminated prior to that date, without the consent of the Board of Trustees.
Shares are bought and sold at market price (not NAV) and are not individually redeemed from the ETF. There can be no guarantee that an active trading market for ETF shares will develop or be maintained, or that their listing will continue or remain unchanged. Buying or selling ETF shares on an exchange may require the payment of brokerage commissions and frequent trading may incur brokerage costs that detract significantly from investment returns.
While Davis Advisors attempts to manage risk there is no guarantee that an investor will not lose money. Equity markets are volatile and the investment return and principal value of an investment will vary. Diversification does not ensure against loss.
Davis Advisors is committed to communicating with our investment partners as candidly as possible because we believe our investors benefit from understanding our investment philosophy and approach. Our views and opinions include “forward-looking statements” which may or may not be accurate over the long term. Forward-looking statements can be identified by words like “believe,” “expect,” “anticipate,” or similar expressions. You should not place undue reliance on forward-looking statements, which are current as of the date of this report. We disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events, or otherwise. While we believe we have a reasonable basis for our appraisals and we have confidence in our opinions, actual results may differ materially from those we anticipate.
The information provided in this material should not be considered a recommendation to buy, sell or hold any particular security. As of January 11, 2017, the top ten holdings of Davis Select U.S. Equity ETF were: Berkshire Hathaway Inc., Class B, 9.48%, Alphabet Inc., Class C, 7.26%, Amazon.com, Inc., 7.26%, United Technologies Corp., 6.94%, American Express Co., 6.38%, Apache Corp., 6.25%, Johnson Controls International PLC, 4.77%, Markel Corp., 4.75%, JPMorgan Chase & Co., 4.51%, Bank of New York Mellon Corp., 4.50%.
As of January 11, 2017, the top ten holdings of Davis Select Financial ETF were: Markel Corp., 6.70%, Capital One Financial Corp., 6.13%, Loews Corp., 6.06%, American Express Co., 5.99%, Berkshire Hathaway Inc., Class B, 5.79%, U.S. Bancorp, 5.53%, Chubb Ltd., 5.37%, Visa Inc., Class A, 5.21%, Goldman Sachs Group Inc., 4.54%, JPMorgan Chase & Co., 4.51%.
As of January 11, 2017, the top ten holdings of Davis Select Worldwide ETF were: Alphabet Inc., Class C, 6.47%, Encana Corp., 5.68%, Amazon.com, Inc., 4.83%, Apache Corp., 4.74%, Berkshire Hathaway Inc., Class B, 4.59%, Adient PLC, 4.49%, Wells Fargo & Co., 4.48%, Naspers Ltd.–N, 4.45%, JPMorgan Chase & Co., 4.00%, Sul America S.A., 3.71%.
Davis Fundamental ETF Trust has adopted a Portfolio Holdings Disclosure policy that governs the release of non-public portfolio holding information. This policy is described in the prospectus. Holding percentages are subject to change. Visit davisetfs.com or call 800-279-0279 for the most current public portfolio holdings information.
XLF is the ETF Financial Select Sector SPDR Fund. The Financial Select Sector SPDR Fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of publicly traded equity securities of companies in the Financial Select Sector Index. The expense ratio for XLF is 0.14%. Principal risks of XLF include Passive Strategy/Index Risk, Index Tracking Risk, Financial Sector Risk and Mortgage REIT Risk. XLF is a passive index fund that invests in the financial sector industries represented by the Financial Select Sector Index. The companies included in the Financial Select Sector Index are selected on the basis of general industry classification from a universe of companies defined by the S&P 500. XLF attempts to track the performance of an unmanaged index of securities, regardless of the current or projected performance of the Index or of the actual securities comprising the Index. As of December 31, 2016, the top ten holdings of XLF were: Berkshire Hathaway, 10.85%; JP Morgan Chase, 10.82%; Wells Fargo, 8.73%; Bank of America, 7.83%; Citigroup, 5.93%; Goldman Sachs, 3.10%; US Bancorp, 2.88%; American Intl Group, 2.23%; Chubb, 2.15%; and Morgan Stanley, 2.14%. This is not a solicitation for the Financial Select Sector SPDR Fund.
Shares of the Davis Fundamental ETF Trust are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested.
Foreside Fund Services, LLC, 3 Canal Plaza, Suite 100, Portland, Maine 04101 800 279 0279, davisetfs.com